12/4/2011 - The Current Market Sentiment

The risk appetite has been undermined by the Japanese announcement of elevating the current nuclear radiations risks which are facing Japan to the seventh degree which is the same degree which has been announced after Chernobyl nuclear crisis to bring back the worries about the Japanese economy to contain current market sentiment driving up the low yielding currencies and the Swiss Frank putting pressure on the British pound and the single currency helping the greenback and the Japanese yen to correct some of their recent loses.
This dovish sentiment could also weigh on the European and US equities markets to open in the red territory leading Dow Jones to continue easing back from the new high which has been reached last week at 12450 since the credit crisis trading currently at 12250.
The Swiss Frank could get back the investors' interests again with the persisting of the nuclear worries in Japan while the tension in the middle is still on with no clear end forced UK and US to declare the need for taking more aggressive actions against El Qaddafi's troops which can increase the demand for the Swiss frank too as a safe haven option.
While the British pound is still under pressure since the release of March CPI index which has got back to 4% from 4.4% in February while the market was waiting for 4.4% again which can lower the pressure on BOE to hike the interest rate for fighting the inflation focusing on the growth needs of the current kept easing monetary stance which can undermine the cable which has been trading at 1.6315 by the release of the inflation data to be traded currently at 1.626 after reaching 1.6225
Despite the dovish Germane ZEW economic sentiment release of March which has fallen to 7.6 from 14.1 which the market was waiting for 11.3 and also EU ZEW economic sentiment release of April which came down to 19.7 from 31 in March while the market was waiting for easing to 29.6 merely, the single currency could continue rising from 1.4375 to record new high versus the greenback since the credit crisis at 1.4518 thanks to the interest rate outlook differential which stands by the single currency currently while the Fed is widely expected to extended its holding of its quantitive easing policy into this year downplaying the prices upside risks on the underling inflation over the long term.